Drug Makers to Pay $421M to Settle False Claims Allegations

John Commins, for HealthLeaders Media , December 8, 2010

"The company at all times complied with laws, regulations and customary industry practices.  Our generic medicines lower the overall cost of the US healthcare system – a shared goal of healthcare reform," Roxane said in a statement. "The expense of protracted litigation adds to the cost of producing Roxane medicines and therefore impacts the competitiveness of our business."

Abbott is paying $126.5 million to resolve the claims against it in two whistleblower cases challenging its pricing of intravenous dextrose solutions, sodium chloride solutions, sterile water, vancomycin, and the oral antibiotic drug erythromycin.

Abbott also denied any wrongdoing. "We continue to believe that we have complied with all laws and regulations and have entered into this agreement to eliminate the uncertainty associated with continued litigation," said Adelle Infanct, manager of external communications for Abbott.

B. Braun Medical Inc., a U.S. subsidiary of German pharmaceutical company, B. Braun Melsungen AG, has agreed to pay $14.7 million to resolve allegations that inflated drug prices for 49 of its drugs, including water-based solutions used for intravenous infusion of other drugs and for fluid replacement, including dextrose solutions, sodium chloride solutions, sterile water and lactated ringers solution, intravenous nutritional solutions and other intravenous drugs.

Tony West, assistant attorney general for the Justice Department's Civil Division, said the federal government has recovered more than $1.8 billion from drug makers using similar drug pricing schemes. "By offering their customers one price and then falsely reporting a greatly inflated price to the lists the government uses when determining how much to pay for the drugs, we believe pharmaceutical companies created an incentive for the purchase of their drugs, since buyers could obtain government payment at the inflated price and pocket the difference," West said. "Taxpayer-funded kickback schemes like this not only cost federal healthcare programs millions of dollars, they threaten to undermine the integrity of the choices healthcare providers make for their patients."

John Commins is a senior editor with HealthLeaders Media.

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